The state health insurer of South Korea stated that it was looking for a preliminary 53.7 billion earned from 3 tobacco firms, including the local divisions of British American Tobacco (BATS.L) and Philip Morris (PM.N) to make up for the costs of treatment for diseases associated with smoking.

A man smokes as he passes the British American Tobacco offices in London May 6, 2009.CREDIT: REUTERS/LUKE MACGREGOR/FILES

The National Health Insurance Service (NHIS) stated that it was charging the two international cigarette manufacturers and KT&G Corp, the local market chief in a South Korean court.

Just 4 tobacco cases have been recorded till now in South Korea, all of which, are filed by families or individuals and there is not a single example of a successful action taken against a tobacco firm.

All the damages were estimated depending upon the payment data by state insurers for those patients with 3 types of cancer related to smoking, according to the NHIS. Earlier, the insurer had told that it spends over $1.6 billion every year in giving treatment for smoking related illnesses.

This is the first case by a state association against tobacco companies amongst 37 nations and territories in Western Pacific region, as per reports from Western Pacific Region Office (WHO WPRO) of World Health Organization.

According to KT&G, its response would be based on the proceedings on earlier legal procedures. BAT refused to comment on the matter, while Philip Morris could not be reached either.

Sun-young, a NHIS attorney stated – “We believe the NHIS, as it takes responsibility for the health of the public and oversees the insurance budget, has a natural duty to bring this tobacco lawsuit.”

BAT and Philip Morris put together, account for around one third of $9.3 billion worth tobacco market of South Korea. KT&G is accountable for the rest of the 60%, whereas Japan Tobacco International (JTI), Japan Tobacco Inc’s associate, possesses the smallest market share (6.4%). However, the lawsuit did not include JTI’s name.